North East Freight Roads Tasman Highway and Gladstone Main Road Upgrades from Derby through to Herrick Submission to the Parliamentary Standing Committee on Public Works
July 2012
Department of Infrastructure, Energy and Resources Contents
A. PROPONENT AND PROJECT DETAILS ...... 1 A 1. Proponent ...... 1 A 2. Project Description ...... 1 B. STRATEGIC FIT ...... 6 C. PROJECT OUTCOMES ...... 6 D. PROJECT APPROACH AND TIMING ...... 7 E. FINANCIAL ANALYSIS ...... 8 E 1. Anticipated Project Total Outturn Cost ...... 8 E 2. Cost Benefit Analysis ...... 8 F. RISK AND GOVERNANCE ...... 8 F 1. Environmental and Cultural Issues ...... 9 F 2. Public and Stakeholders ...... 10 G. FREIGHT DEMAND FORECASTS ...... 11
Appendix A – Risk Assessment Appendix B – Governance
A. PROPONENT AND PROJECT DETAILS
A 1. Proponent
Department of Infrastructure, Energy and Resources 10 Murray Street HOBART TAS 7000
A 2. Project Description
In 2007 the Australian and Tasmanian Governments committed $34 million and $8.5 million respectively for a total investment of $42.5 million towards a North East Freight Roads program. This included projects that target improved safety, efficiency and level of service along key freight roads in the north east of Tasmania to meet the then forecast 40% increase in freight generated from this part of the state (DIER 2010, Project Proposal Report (Scoping)– North East Freight Roads).
As a part of the North East Freight Roads program, this Submission presents a case to upgrade sections of the Tasman Highway and Gladstone Main Road from the townships of Derby through to Herrick, in the north east of Tasmania, to comply with agreed High Productivity Vehicle standards (HPV – maximum 62.5 ton gross vehicle mass). The upgrades include widening, improved geometry for the safety of all road users and the inclusion of new school bus bays. Both roads are located in the north east of Tasmania (within the Municipality of Dorset) and form a freight route between large areas of softwood and hardwood timber plantations and their destination of Bell Bay. Refer to Map A2.1 for general overview.
The economy of north east Tasmania is dependent on primary industries, including forestry, dairy farming and agriculture, with tourism growing in significance. Forestry freight is the major freight task in the region and the projected increase in freight relates to the harvesting of plantation forestry estate in the region over recent years.
1 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Map A2.1: Tasman Highway and Gladstone Main Road Location Overview
A gazetted high productivity vehicle route exists between Bell Bay and Derby. The proposed upgrades covered within this Submission extend the HPV route to within proximity of timber plantations in the north east of Tasmania.
At present, trucks transporting freight through the region proposed for upgrades are restricted to General Access vehicles (GA – maximum 50t gross vehicle mass), and these restrictions affect the timber industry in particular. The proposed upgrade presents a significant increase in efficiency for industries operating in the north east of Tasmania.
Existing Road Table 1 below provides information of the current conditions of the Tasman Highway and Gladstone Main Road between Derby and Herrick.
Table 1: Existing Asset Information
Sealed / Road No. Lanes Lane Width (m) Shoulder Width (mm) AADT* Unsealed
Tasman HWY 2 Sealed 5.8 Approx. 300 (varies) 744
Gladstone MR 2 Sealed 5.5 Approx. 300 (varies) 395
*AADT = Annual Average Daily Traffic – Sourced from DIER Traffic Data
2 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Proposed Upgrades The proposed upgrade works will generally consist of basic pavement widening, geometric improvements, targeted pavement strengthening, junction improvements and the provision of safety barriers where required. The upgrade works will take place along 8.76km of the Taman Highway (between Derby and the Gladstone Main Road junction) and 2.06km of Gladstone Main Road (between the Tasman Highway junction to the township of Herrick).
Along with the benefits to industries operating in the area, the upgrades will increase the safety for all road users and promote better interactions between passenger and freight vehicles. Included in the upgrades works is the provision of three new bus bays, which will provide a safer transport environment for local school children. The upgrades will also benefit travellers wishing to experience the “Trail of the Tin Dragon” touring route, which incorporates Tasman Highway between Derby and Gladstone Main Road.
Upgrade works will ensure 8m of pavement width from Derby through to Herrick, specifically:
• Basic widening of the Tasman Highway from 5.8m to 8m sealed width (plus 0.5m unsealed verge each side); • Basic widening of Gladstone Main Road from 5.5m to 8m sealed width (plus 0.5m unsealed verge each side); • Improving road geometry for a 70km/h design speed limit (60km/h from Derby for 1.5km due to complex geometry); • Horizontal and vertical curve realignments; • Sight benching; • Provision of safety barriers where required; • Improvements to the Tasman Highway and Gladstone Main Road junction; • Improvements to the Tasman Highway and Winnaleah Road junction; • Accommodation works including the relocations of overhead and underground services; and • The construction of three new sealed bus bays.
Cost estimates for the upgrade works have been carried out and the value of works is estimated to be $14.4 million at 90% confidence level (P90), and $13.8 million at 50% confidence level (P50). Upgrades to the sections of Tasman Hwy and Gladstone Main Road are diagrammatically shown overleaf in Map 2.2.
Map A2.2 Overleaf: Proposed Upgrade Works for the Tasman Highway and Gladstone Main Road
3 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
4 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
The Planning and Scoping Phase for the project has been completed and the Development and Delivery Phase is currently underway. Table 2 below shows the status of a number of important tasks required for the completion of the proposed upgrades.
Table 2: Tasman Highway and Gladstone Main Road Upgrades Scope of Work
Description of Task Status as of July 2012 Geotechnical investigations along the Tasman Highway Completed and Gladstone Main Road
Built heritage assessments Completed
Land capability assessments Completed
Flora and fauna investigations Completed
Contaminated land assessment Completed
Drainage assessments Completed
Stakeholder engagement / community consultation Ongoing
Indicative plans produced for community Property acquisition plans consultation based on Concept Design
Development application Completed
Service relocation plans In progress
Preliminary design of all upgrades to the Tasman Highway Completed and Gladstone Main Road
Detailed design of all upgrades to the Tasman Highway Underway and Gladstone Main Road
Tender documentation Underway
Construction of all upgrades to the Tasman Highway and To be carried out Gladstone Main Road
The proposed project timeline will see completion of the major upgrade works by June 2014. Note that an additional 14mm spray and seal is required to take place approximately 12 months following the completion of construction activities (i.e. during the 2014 / 2015 summer period), however the upgraded road sections shall be open for use and fit for HPV compliance after the completion of major works by June 2014, and only minor traffic delays will be experienced during the additional sealing and line marking activities. Refer to Section D for the anticipated milestones of the upgrades to the Tasman Highway and Gladstone Main Road.
5 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works B. STRATEGIC FIT
The Development and Delivery Phases for these road upgrades (as part of the North East Freight Roads program) was approved in July 2011 by the Minister for Infrastructure and Transport.
The North East Freight Roads Strategy is identified in the MOU between the Australian and Tasmanian Governments.
The Project meets the Strategic Merits Test for the North East Freight Roads Strategy and was forwarded to the then Department of Infrastructure, Transport, Regional Development and Local Government (DITRDLG) in June 2008 as the business case document for this Nation Building Program Schedule A project.
C. PROJECT OUTCOMES
The Tasman Highway and Gladstone Main Road Upgrades project will support the following strategic objectives:
• Improve safety and consistency of travel environment along the Tasman Highway and Gladstone Main Road between Derby and Herrick for all road users (specifically freight vehicle road users); • Increase transport productivity and improved efficiencies for industry operating in north east Tasmania; • Reduce annual truck numbers operating along the Tasman Highway and Gladstone Main Road (resulting from increased vehicle capacities); and • Improve safety for school bus routes.
The key outcomes of this project are:
• To safely upgrade the Tasman Highway and Gladstone Main Road between Derby and Herrick, to a standard that will enable an application for the Tasman Highway (between Derby and the Gladstone Main Road intersection), and Gladstone Main Road (between Tebrakunna Road at Pioneer and the Tasman Highway), to be gazetted as an HPV route; • To improve safety for both passenger and freight vehicles travelling in the area; and • To improve transport efficiencies for industry vehicles operating in the area.
6 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
D. PROJECT APPROACH AND TIMING
The development and delivery program is underpinned by the need to complete the project by the end of Nation Building Program which ends in June 2014. The key milestones for the Development and Delivery Phase are described in Table 3.
Table 3: Development and Delivery Phase Milestones
Completion Date / Critical Path Key Milestones Timing (Yes/No) Establishment of Project • Submission and approval of PPR to DoIT • Report for Parliamentary Standing Committee for July 2012 Yes Public Works approval process • Review of constructability Stakeholder Consultation (ongoing) No Approvals • Submission of development application to Dorset May 2012 Council Yes • Dorset Council approval of development application June 2012
Land Acquisition August 2012 No Development Phase
• Preliminary design completion August 2012 Yes • Sponsor approval • Detailed design completion September 2012 Yes • Tender documentation & Call Tenders
Delivery Phase – Tendering
• Tender assessment November 2012 Yes • Tender award
Service Relocations • Aurora Energy service relocations (e.g. power poles, stay cables). January 2013 Yes • Telstra service relocations • Irrigation service relocations
Delivery Phase – Pre-construction Activities • Design report • Contract administration plan • Contractors CEMP January 2013 Yes • Possession of Site • Site establishment
Construction June 2014 Yes Final Seal and Line Marking May 2015 No
7 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
E. FINANCIAL ANALYSIS
E 1. Anticipated Project Total Outturn Cost
Total project outturn cost for the proposed upgrades to the Tasman Highway and Gladstone Main Road is $14.4 million at a 90% confidence level (P90). The corresponding outturn cost at a 50% confidence level (P50) is $13.8 million. These values were determined using the Evans and Peck “Best Practice Cost Estimation for Publicly Funded Projects”.
The cash flow shown in Table 4 below is for the P50 and P90 capital expenditure values. Table 4: Cash Flow Year 2011/2012 2012/2013 2013/2014 2014/2015 Total Funding
P50 Cash Flow $1.3 million $4.5 million $7.3 million $0.7 million $13.8 million
P90 Cash Flow $1.4 million $4.6 million $7.7 million $0.7 million $14.4 million
E 2. Cost Benefit Analysis
The Cost Benefit Ratio for this project is 1.0, allowing for the current economic downturn in the freight industry but allowing for forecast growth after 2015 and using a discount rate of 4.0%.
F. RISK AND GOVERNANCE
DIER has established a Governance Structure and Risk Assessment process, both of which have been set up to support delivery of the North East Freight Strategy. Governance for this project fits in with the overall NEFR governance structure set out in the May 2010 PPR (Scoping) – North East Freight Roads and reiterated in the May 2011 Amendment. The Governance structure is detailed in Appendix B.
The key risks associated with this project are: • Design time and DIER review and approval time; • Scope creep during design or construction; • Delayed completion of Aurora Energy design and relocation of power poles; • Obtaining Aurora Energy landowner agreements for services to be relocated; • Unforseen underground services; • Appeals on conditions imposed by Dorset Council; • Delays associated with accommodation works;
8 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
• Unforseen geotechnical conditions, and; • Adverse weather. Further details of the risks involved with this project are provided in Appendix A of this Submission.
F 1. Environmental and Cultural Issues
Aboriginal Heritage A number of environmental and cultural investigations have been completed as a part of the Development Phase projects. A Desktop Aboriginal Cultural Heritage study was completed in April 2011. A search of the Tasmanian Aboriginal Site Index found no aboriginal heritage sites occur within or close to the proposed upgrade works. Aboriginal Heritage Tasmania (AHT) has advised that there is no requirement for field investigations due to the low probability of any aboriginal cultural heritage occurring within the upgrades and that AHT have no objections to the project. Construction works shall be subject to standard artefact discovery procedures.
Flora and Fauna Flora and fauna investigations, including field study and camera trap survey, were undertaken in December 2010 and May 2011. The investigations found that no EPBC listed or threatened Tasmanian plant species occur near the proposed upgrade works. A number of suitable habitat logs for threatened fauna were discovered in a forested area near the Tasman Highway and Gladstone Main Road junction. However, a camera trap survey did not find any evidence of threatened fauna species. These habitat logs will be relocated. Given the results of the Flora and Fauna investigations, there are no significant impacts to threatened flora and fauna resulting from the proposed upgrades to the Tasman Highway and Gladstone Main Road.
Due to the proposed road widening and sight benching activities included in the upgrade works, a number of non-listed native vegetation communities occurring adjacent to the existing road corridor need to be partially cleared. These communities are located near the junction of the Tasman Highway and Gladstone Main Road, along Gladstone Main Road itself, and include damp sclerophyll forest, Black Peppermint coastal forest and Kunzea regrowth. The total area of native vegetation to be cleared is approximately 1.0 Ha. As the clearing of land is required for the construction of a public road, a forest practices plan should not be required for the Tasman Highway and Gladstone Main Road upgrades project.
Historical Heritage A Historical Heritage Assessment was undertaken along the Tasman Highway and Gladstone Main Road within the bounds of the proposed construction activities. The assessment found a number of sites occurring within or close to the proposed upgrade works with potential heritage significance. However, no site is listed on the Dorset Planning Scheme or National or Commonwealth Heritage Lists, and only one site is listed on the Tasmanian Heritage Register (i.e. the Derby Grandstand and Change Sheds). Heritage Tasmania has been informed of the upgrade projects and mitigation 9 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works measures have been proposed to minimise the impact of the proposed upgrades on areas with potential heritage values.
The proposed upgrades are foreseen to have very limited impact on a drainage / water race outlet near Derby, and two long avenues of oak trees running parallel to the Tasman Highway. .
Two rows of macrocarpa pine trees running perpendicular to the Tasman Highway and a pre 1970s stone milepost will be partially impacted due to the clear zone requirements of the upgraded Tasman Highway (however, the mile post will be relocated within the new road reserve). Similarly, three rows of pine trees running parallel to the Tasman Highway are required to be removed to provide adequate clear zone.
F 2. Public and Stakeholders
Public consultation and stakeholder engagement is ongoing. A public display was conducted in Derby and Scottsdale to provide the local community with information on the proposed works, likely construction dates and an opportunity to raise any areas of concern. There were no responses to the display. The key stakeholders to the upgrades of the Tasman Highway and Gladstone Main Road are:
• Australian Federal Government; • Dorset Council; • Forestry Industry; • Agriculture industry (including Dairy); • Private Landowners; and • School bus operators.
Utility Stakeholders include: • Aurora Energy PTY LTD • Telstra PTY LTD • National Broadband Network; • Ben Lomond Water; and • Winnaleah Irrigation.
The upgrades to the Tasman Highway and Gladstone Main Road require some areas of private land to be acquired, property fence relocations, existing service relocations and alterations / disruptions to access ways. All property owners who are affected by these issues have been contacted by DIER representatives and concerns resolved. Dorset Council has also been contacted to discuss the proposed upgrades, a Development Application submitted and a Planning Permit has since been granted. The conditions attached to the planning permit do not have any significant implications for the project
10 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Aurora Energy has been engaged to facilitate the relocation of power poles currently residing within the proposed upgrade works, and is responsible for the relocation designs. On completion of the design work for power pole relocations, private property owner’s consent is required. Prior to the completion of final design and actual power pole relocation works, a substantial risk of landowners refusing to agree to pole relocations within their property exists, which may compromise the project critical path. Land owner negotiations have been incorporated into the project programme, and a contingency for the service locations has been allowed for within the cost estimate.
A number of Telstra underground services have been identified. . The exact proximity of the services will be tested through the development phase, and a contingency within the cost estimate has been included.
A number of irrigation crossings and water supply pipes are similarly within the proximity of the works. An allowance for the identification and relocation of water infrastructure has been included within the cost estimate.
As well as the meetings already undertaken, stakeholder engagement will occur in the following ways:
• Ongoing briefing and liaison with the above mentioned stakeholders in relation to the upgrade works, property acquisition, service relocations and construction dates; • Liaison with Telstra regarding relocation of any overhead and underground services; • Liaison with Ben Lomond Water regarding relocation of any existing water services that will be affected by the upgrade works; • Public notices for road disruptions and closures; • Periodic media articles describing road closures and construction timetables; and • Letters of notification to all stakeholders.
G. FREIGHT DEMAND FORECASTS
Forestry Freight: Forestry freight is the dominant task within north east of the state and also the specific project location. In the 2009 Tasmanian Freight Survey just over 1 million tonnes of hardwood logs and 680,000 tonnes of softwood logs were harvested from the region, representing 22% and 50% of the total state harvest respectively. Quantification of the forecast forestry task has been calculated using DIER’s Forestry Freight Model (FFM) which utilises industry supplied projected harvest volume data and timber destination. Two sets of data have been analysed with the FFM:
• Combined plantation (including hardwood and softwood) and non-plantation timber resource utilising data collected in 2003 • Plantation ONLY data utilising data collected in 2011
The plantation only data represents a conservative minimum estimate of future forestry freight, while the combined data (which includes non-plantation timber) represents an upper estimate. Because the plantation only data was obtained in 2011, in context of the current down-turn and re-structuring in the 11 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works industry, plantation harvest volumes provided until 2015 are below the long-term forecast average. Therefore, the economic analysis has been based on plantation only harvest volumes from 2015 onwards.
At a state-wide level, the Tasmanian Forests Intergovernmental Agreement (2011) has resulted in 430,000 hectares of native forest being immediately placed into informal reserves and an independent verification group is examining a total of 572,000 hectares and will make recommendations on future reservation. Reservations under this Forest Agreement will result in some changes in harvest forecasts under the original 2003 FFM data. However, it is important to note that for the north east region a high proportion of timber is contained in the plantation estate. There are significant areas of state forest that are not identified for reservation under the Forest Agreement, and so may be available for future harvest (see green areas on map below). It is on this basis that future harvest is likely to be higher than the plantation only dataset.
In terms of the proposed upgrades to the Tasman Highway and Gladstone Main Road, the FFM forecasts daily laden log truck movements within the ranges in Table 6Error! Reference source not found.. Truck numbers are on the basis of trucks carrying plantation only logs (lower limit) and an upper limit being the original FFM data which includes both plantation and non-plantation logs. Comparing 2015 to 2025, on Gladstone Main Road laden log truck numbers from plantation rise from 8 to 11 per day (average 9) , whilst upper limit values rise from 9 to 16 per day (average 13). Through Derby on the Tasman Highway, plantation truck numbers rise from 15 to 26 (average 21) per day. 12 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Upper limit truck numbers fluctuate from 40 (2015) to 47 (2020) then back to 35 per day (2025), but average 41 per day over the period.
Table 5: Forestry Freight Model Data - Daily Truck Movements
Location LADEN Daily Log Truck Movements* 2012** 2015 2020 2025
2011 2003 2011 2003 2011 2003 2011 2003 Plantation Combined Plantation Combined Plantation Combined Plantation Combined Only Data data Only Data data Only Data data Only Data data Gladstone Main Road 4 14 8 9 9 14 11 16 Tasman Highway – through Derby 9 35 15 40 21 47 26 35
*FFM assumes 32 tonne payload per truck operating 240 days per year. Doubling of figures required to include un-laden truck trips ** Plantation data provided with knowledge of current downturn in Forestry industry. Upper-limit data provided before downturn
Agriculture Freight: In 2011 close to 140,000 tonnes of raw milk was produced in the north east, of which an estimated 30,000 tonnes was sourced from the Winnaleah locality and 10,000 tonnes from Gladstone, both of which utilise the proposed road upgrades. Freight trucks are used to transport raw milk to the processing facility at Fonterra’s Spreyton plant in the north west of Tasmania. Milk production fluctuates throughout the year with peak production September to November resulting in up to 6 truck- loads per day on the Tasman Highway (through Derby) and 2 truck-loads per day on Gladstone Main Road. The average through the year is 3.5 trucks on the Tasman Highway (through Derby) and 1 truck per day on Gladstone Main Road.
The Tasmanian Freight Survey was conducted in 2009 and provides heavy truck freight estimates for the north east region. Estimated non-dairy agricultural freight on the Tasman Highway through Derby in 2009 was 58,000 tonnes. Raw milk freight was not captured in this estimate but was approximately 45,000 tonnes. The total of close to 105,000 tonnes of agricultural freight represents 29% of all freight through Derby and would result in approximately 30 laden truck movements per day (various size trucks, assuming 240 operating days per year). At the southern end of Gladstone Main Road agriculture makes up approximately 27,000 tonnes per year (including raw milk estimate). Because Tebrakunna Bridge was unusable during 2009 forestry freight was markedly reduced along Gladstone Main Road for the year of the survey and so total freight on the road was unusually low. Revising the total tonnage by utilising a more normal average 13 forestry trucks per day the agriculture component would make up 19% of all freight on Gladstone Main Road and would result in approximately 10 laden truck movements per day (various size trucks, assuming 240 operating days per year).
Regional production from the dairy industry is forecast to grow by nearly 50% by 2015, while longer term projections out to 2030 for the agricultural sector as a whole utilise growth figures of 150% above 2009 levels. Recently completed and future proposed irrigation schemes will improve water reliability
13 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works resulting in expansion of the area suitable for dairy production around these towns, and will be a major contributor to the projected growth in the entire agricultural sector.
14 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Appendix A – Risk Assessment
DIER has adopted a formal risk assessment model to be applied in all projects.
The model requires the following steps: • Identification of possible risk events,; • Scoring “consequence” ( scale of 1 (low) – 6 (catastrophic)) and “likelihood” ( scale 1( rare) – 5 (almost certain)) of that event occurring; • Determine the risk ranking ( via risk assessment matrix); • Proposing risk mitigation strategies; • Revise the consequence and likelihood ratings for each risk with mitigation strategy implemented; and • Revise the risk ranking for each risk event with mitigation strategies in place.
Note that the “consequence” scoring is based on agreed project planning related definitions, and includes consideration of Community, Environment and Heritage, Legal and Compliance, Reputation, Management Impact, Financial Impact and Program Impact.
The Risk Assessment matrix framework and definitions can be found on the following pages. Financial risks are included as part of the cost estimation model.
The following page shows the identified risk events for the Tasman Highway and Gladstone Main Road Upgrades Project, their impact, risk rating, mitigation strategies and revised risk rating, throughout the Development and Delivery Phases of the project.
15 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
RISK MATRIX LIKELIHOOD (Refer to Definitions right) 5. Almost 1. Rare 2. Unlikely 3. Possible 4. Likely Certain
6 - Catastrophic B B A A A Risk Action Levels C
C
(Refer toDefinitions O O 5 - Extreme C B B A A N N Overleaf) S S E E 4 - Severe C C B B A Q Q U U E E 3 - High D C C B B
N Immediately stop the process; N
A - Extreme C C E E 2 - Medium Minister/Secretary decision/direction required.
S D D C C B S
1 - Low D D D C C Take immediate action to further control the risk; B - High General Manager/Governance Group action Likelihood Definitions: required. What is the likelihood of the selected consequences occurring? Specific risk management plan to be C - Medium implemented. Rating Criteria Review for improvement opportunities. Over 90% probability; or Implement normal procedures and processes. 5. Almost Certain “Happens Often”; or D - Low “Unlikely that it won’t happen” Monitor risk, reduce if practicable.
4. Likely Greater than 50% probability; or “Could easily happen”
3. Possible Greater than 10% probability; or “Could happen, has occurred before”.
2. Unlikely Greater than 1% probability; or “Hasn’t happened yet but could”.
1. Rare Less than 1% probability; or Conceivable, but only in extreme circumstances.
16 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Consequence Definitions – What are the likely consequences in the event of a failure?
Rating Community Environment & Heritage Legal & Compliance Reputation Management Impact Financial Impact Program Impact Project unable to Very serious long term proceed; Complete loss of impairment of ecosystem Major litigation with Requires management at Loss of Federal funding; trust by affected or damage to a species; significant damages costs; Minister or Government Ministerial level. Election commitment Project is never able community leading Total destruction of Jailing of Minister or forced to resign; Requires new or amended projects cancelled or to proceed to social unrest & significant heritage items Secretary; Legislation. deferred to balance outrage. and complete loss of Court or NGO imposed fine
Catastrophic budget heritage values Additional funding Major litigation ; required from Federal Prolonged Serious medium term Secretary leaves; Class action; Critical event that requires Government at project Project is delayed community environmental effects; National press reporting. Possibility of custodial considerable Secretarial time level indefinitely outrage; Partial loss of significant Vote of no confidence in sentence for Senior to handle over many months. Additional funding Extreme heritage items and values Minister Management. required from State to balance program budge Long-term community irritant Moderate short-term leading to effects but not affecting Major breach of regulation Will require the involvement Other projects cancelled Critical timeframe for disruptive actions ecosystem function; with punitive fine; of the Secretary and will take or deferred (Internal delivery cannot be & requiring Disturbance of heritage Divisional Manager leaves; Significant litigation involving the time of R & T General budget reallocation.) met continual items and moderate impact State-based media reporting. Severe many weeks of Divisional Manager over an extended management on heritage values Management time. period attention
Minor effects on biological Significant event that can be Serious breach of regulation Short term or physiological Manager disciplined; managed with the careful Scope reduced on other Significant delay environment; with investigation or report to community outrage Significant level of management attention; projects in the program. against non-critical Minor effects on heritage authority with prosecution
High or longer term discussion in Parliament; Will take some Branch-level Internal budget timeframe for and/or moderate fine unrest & dissention values Local media reporting. Management time over reallocation. delivery possible. several weeks. One-off community Moderate delay protest requiring Limited damage to minimal Minor legal issues, non- Scope reduced on this Employee disciplined; Will require Section Manager against non-critical intervention and area or low significance; compliances and breaches project Public awareness. attention over several days. timeframe for management of regulation. Medium delivery attention
Small impact; No visible impact on the Impact of event absorbed in Use of contingency funds Minor delay to One complaint Minor breach of regulation.
Low portfolio normal management activity. is required. program
17 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
TASMAN HIGHWAY AND GLADSTONE MAIN ROAD UPGRADES - RISK ASSESSMENT Development and Delivery Phase - 29/5/12
Residual Risk
Contingent
or
Due Completed
(I/C) level level
Responsible Risk Inherent Likelihood Consequence Risk Risk Action Action Number Element Risk Potential Consequence Risk treatment initiative party Likelihood Consequence
1Scope
Designers to ensure that all current standards are adhered to, DIER to inform designers of any major changes to internal Design standards change during design Project cost, timeline, and stakeholders standards during detailed design 1.1 process affected. 13Dphase SKM 1 3 D C Ongoing Designer is to seek approval to depart from guidelines and standards, risk assessment for divergance 1.2 Design standards can't be achieved Project approval delays 13Dfrom standards will be required SKM 1 3 D I 22-Jun-12 Discussions recorded in "Consultation Manager" program, landowners to sign agreements of discussions. SKM to send letters to affected property Disruption with contractor activities on owners detailing construction 1.3 Landowner requirements affect project scope site, design documentation not fixed 24Cimpacts SKM 1 4 C I 16-Jul-12 Consultation with land owners on their knowledge of u/g services to take place early in detailed Scope change through underground services Disruption with contractor activities on design phase. Expose critical 1.4 discovery site, design documentation not fixed 34Bservices to confirm location. SKM 2 4 C C 25-Jun-12 Consultation with relevant service providers regarding exisitng / future services to be Disruption with contractor activities on undertaken early in detailed 1.5 Service providers require additional services site, design documentation not fixed 33Cdesign phase SKM 1 3 D C 18-Jun-12 Undertake further landowner consultation and gather local knowledge on geotech issues (landslips etc), tender documentaiton to be designed to minimise disputes regarding geotechnical issues. SKM and Project cost, timeline, and stakeholders DIER PM, and DIER CA to Unforeseen geotechnical issues requiring scope affected, potential cease project and review P50 / P90 (especially 1.6 change to design recommence 34Bcontingencies SKM, DIER 3 4 B I 18-Jun-12
On site inspection of all existing Existing drainage pipes in poor condition culverts to take place in detailed 1.7 requiring replacement Project cost affected 33Cdesign phase SKM 3 1 D C 18-Jun-12
18 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
TASMAN HIGHWAY AND GLADSTONE MAIN ROAD UPGRADES - RISK ASSESSMENT Development and Delivery Phase - 29/5/12
Residual Risk
Contingent
or
Due Completed
(I/C) level level
Responsible Risk Risk Inherent Likelihood Consequence Risk Action Action Number Element Risk Potential Consequence Risk treatment initiative party Likelihood Consequence
2Programme
Limit changes and reviews to Delay to overall project programme. document which may delay 2.1 Delay to PPR approval upsetting start time Risk to Jun '14 funding deadline 34Bsubmission time SKM, DIER 2 4 C C - SKM to have detailed understanding on how design issues affect detailed design. SKM project manager to provide more information to DIER regarding these issues on regular basis. Programme to be Delay to overall project programme. baselined and tracked. DIER to 2.2 Design process takes longer than planned Risk to Jun '14 funding deadline 34Bbe advised of any slippage SKM 3 4 B C Ongoing DIER to ensure ravailable resources through internal planning discussions. Only DIER DIER drawing approval takes longer than Delay to overall project programme. Contract Admin and PM reviews 2.3 planned Risk to Jun '14 funding deadline 34Bto take place. DIER 2 4 C C 10-Aug-12
Delay to overall project programme. Strict controls used for tender 2.4 Tender process takes longer than planned Risk to Jun '14 funding deadline 34Bdates. Clear tender docs SKM, DIER 2 4 C C 24-Aug-12
Delay to overall project programme. Produce clear tender docs. 2.5 Contract negotiations are drawn out. Risk to Jun '14 funding deadline 34BEfficient approval process SKM, DIER 2 4 C C 16-Nov-12
Detailed design to reviewed Project scope creep and variations protract Delay to overall project programme. thoroughly through consultant QA 2.6 delivery timeline Risk to Jun '14 funding deadline 34Bprocess to ensure completion SKM, DIER 3 4 B C 13-Aug-12
Tender documents to clearly Contractor project durations at time of tender Delay to overall project programme. state required construction 2.7 are too long Risk to Jun '14 funding deadline 24Ccompletion dates SKM, DIER 2 4 C C 27-Aug-12
Tender documentation to Contractor project programme (Submitted post Delay to overall project programme. stipulate completion date and 2.8 award) is too protracted Risk to Jun '14 funding deadline 24Cliquidiated damages to be applied SKM, DIER 2 4 C C 27-Aug-12
Mechanisms to be included Contractor fails to deliver project in advised Delay to overall project programme. within the contract to prevent this 2.9 timeline Risk to Jun '14 funding deadline 34B(i.e. liquidated damages) SKM, DIER 2 4 C C 27-Aug-12 Tender documents to state the Contractor programme with multiple critical path Delay to overall project programme. requirement of only "one" critical 2.10 elements Risk to Jun '14 funding deadline 34Bpath SKM, DIER 2 4 C C 27-Aug-12 Contractor risk for weather Inclement weather affects construction Delay to overall project programme. defined within the contract 2.11 programme Risk to Jun '14 funding deadline 34Bdocuments SKM, DIER 2 4 C I 27-Aug-12 Early engagement with Aurora Energy to ensure the completion Delays to Aurora Energy power pole relocation Delay to overall project programme. of relocation designs within 2.12 designs Risk to Jun '14 funding deadline 44Bexpected timeframe SKM, DIER 4 4 B C 18-Jun-12 19 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
TASMAN HIGHWAY AND GLADSTONE MAIN ROAD UPGRADES - RISK ASSESSMENT Development and Delivery Phase - 29/5/12
Residual Risk
Contingent
or
Completed Due
(I/C) level level
Responsible Action Risk Likelihood Consequence Risk Risk Inherent Action Number Element Risk Potential Consequence Risk treatment initiative party Likelihood Consequence
3 Financial PPR not approved for expenditure previously Project does not proceed, or sections 3.1 agreed upon due to unfavourable BCR of scope are removed. 35BNone - outside project control N/A 3 5 B I - P90 cost estimate for preliminary design Project does not proceed, or sections 3.2 exceeds project budget of scope are removed. 23CN/A N/A 2 3 C C -
P90 cost estimate at detailed design exceeds Project does not proceed, or sections Attention to oustanding issues 3.3 project budget of scope are removed. 23Cfrom prelim design. SKM 2 3 C C 13-Aug-12
Scope creep introduces unforseen expenses Attention to oustanding issues 3.4 exceeding project budget Budget is exceeded 34Bfrom prelim design. SKM 2 4 C C 13-Aug-12
Accurate project estimates (P50 Project does not proceed, or sections / P90) to be developed. P50 / 3.5 Tender prices exceed project budget of scope are removed. 35BP90 review to take place. SKM, DIER 2 5 B C 20-Jul-12
DIER and Federal Government to Contractor delivers project ahead of programme be made aware that cash flow 3.6 (cash flow implications) Project funding difficulties 23Cmay exceed projected forecast DIER 1 3 D C - Tender documents to clearly state required construction completion dates. Provide Project does not proceed, or sections Federal Government early Programme exceeds project sunset date June of scope are removed, alternative warning if project end date will 3.7 2014 funding required for works post Jun '14 34Bchange. SKM, DIER 2 4 C I 27-Aug-12 SKM to seek early advice from Telstra regarding service Service relocations exceed budget relocations. Alternative relocation 3.8 (underground) Project funding difficulties 34Boptions to be explored DIER 2 4 C C 18-Jun-12 Alternative relocation options to 3.9 Aurora relocations exceed budget Project funding difficulties 34Bbe explored DIER 2 4 C C Ongoing
20 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
TASMAN HIGHWAY AND GLADSTONE MAIN ROAD UPGRADES - RISK ASSESSMENT Development and Delivery Phase - 29/5/12
Residual Ris k
Contingent
or
Due Completed
(I/C) level level
Responsible Risk Inherent Risk Likelihood Consequence Risk Action Action Number Element Risk Potential Consequence Risk treatment initiative party Likelihood Consequence Stakeholder 4 Management Further landowner consultation to be undertaken early in detailed phase. Letters to be sent to Unforseen requirements from private land Disruption with contractor activities on landowners detailing construction owners site, design documentation not fixed 34Bimpacts SKM 2 4 C C 16-Jul-12 4.1 Approval gained early in Development and Delivery phase and in parallel with PPR funding approval. Meet with Dorset Budget to be exceeded or delays Council to discuss upgrades and 4.2 DA approval given with unforseen conditions beyond Jun 14 24Clandowner issues SKM, DIER 2 4 C C 4-Jun-12 DIER to arrange meeting with Aurora to reinforce MOU responsibilities and obtain commitment to complete the pole relocations ahead of construction. SKM to identify all poles due for relocation and No engagemenet by Aurora with affecting construction if not Aurora wayleave for power poles in design landowners will cause delays in pole moved before construction 4.3 locations not accepted by landowners relocations and affect construction. 54Astarts. DIER 5 4 A C 2-Jul-12
Delay to overall project programme. Compulsary acquisition 4.4 Hold up with acquisition process Risk to Jun '14 funding deadline 34Bprocesses to be undertaken DIER 2 4 C C - Scope changes required, delays to Landowner agreements to be 4.5 Fence relocation issues with landowners programme or increase in budget 32Cobtained in wirting SKM 1 2 D C 16-Jul-12
Undertake further landowner consultation early in detailed Traffic management issues during construction Disruption with contractor activities on design phase and ensure public 4.6 (public outcry) site. Programme delays 33Cnotices submitted DIER 2 3 C C 16-Jul-12 Tender documents to clearly Disruption with contractor activities on state that landowner access is to 4.7 Landowner access during construction site. Programme delays 33Cbe maintained DIER 1 3 D C 27-Aug-12
Further landowner consultation to take place early in detailed Disruption with contractor activities on design phase including Full suite of stakeholders not consulted and site. Scope changes and possible organisers of significant local 4.8 project objectives subsequently not aligned delays to satisfy stakeholders 23Cevents (Derby River Derby etc) SKM 1 3 D I 8-Jun-12 Obtain landowner sign-off on all agreements. Letters to be sent to Records of stakeholder consultation not kept Scope changes and possible delays to all landowners detailing 4.9 and scope of agreements not firmed up satisfy stakeholders 23Cconstruction impacts SKM 1 3 D C 16-Jul-12
Tender documents to specify that Contractor produce Contractor personnel cause issues with local Disruption with contractor activities on community engagement plan for 4.10 community site. Programme delays 33Capproval DIER 1 3 D C 27-Aug-12 Review issues in relation to Representations and provide infromation to satisy Representors at a meeting on 4.11 Development Application and Representations Delays the awarding of the contract. 44Bthe 4 June 2012. SKM 3 4 B 31-May-12
21 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
TASMAN HIGHWAY AND GLADSTONE MAIN ROAD UPGRADES - RISK ASSESSMENT Development and Delivery Phase - 29/5/12
Residual Risk
Contingent
or
Completed Due
level level (I/C)
Responsible Action Likelihood Consequence Risk Risk Inherent Action Risk Number Element Risk Potential Consequence Risk treatment initiative party Likelihood Consequence
5 Resources
Tender documents to specify Increase in materials cost and that Contractor undertake early 5.1 Pavement material sourcing issues therefore to budget 24Cengagment with local quarries DIER 1 4 C C 27-Aug-12 Difficult to deliver design to meet DIER to be notified of any 5.2 Resource issue with designers and consultancy programme requirements 24Cresourcing issues SKM, DIER 2 4 C C Ongoing Delays to programme because of approvals. Insufficient feedback to DIER to undertake resource DIER project management/contract consultants leading to delays or design forecasting and provide additional 5.3 administration resources stretched oversights 24Cpersonell if required DIER 2 4 C C Ongoing Issues or mistakes on site leading to Contractor qualifications to be delays. General delays to contractor reviewed during tender 5.4 Contractor skilled labour issues progress. 33Csubmissions DIER 2 3 C C 26-Oct-12
To be negotiated as a part of the Resources for service relocation management Issues with resourcing causing provision of professional services 5.5 (especially Aurora Energy) programme delays 23Cfor detailed design DIER 2 3 C C 8-Jun-12
6 Communications
DIER to produce PEP with some 6.1 Communication process not mapped out Miscommunications, errors or delays 33Cinput from consultants SKM, DIER 2 3 C C 8-Jun-12 PM's to ensure that PEP plan is 6.2 Communication protocol not followed Miscommunications, errors or delays 22Dadhered to SKM, DIER 2 2 D C Ongoing DIER to undertake formal project Project sponsor has not fully communicated Lost project knowledge leading to handover process from planning 6.3 scoping project to delivery team errors during delivery 23Cto delivery DIER 1 3 D C Ongoing Consultants to undertake formal Change in resources for consultancy and Lost project knowledge leading to project handover process if 6.4 missed information in handover errors during final design/delivery 33Cnecessary SKM 2 3 C C Ongoing
Project sponsor to ensure that Parliamentary communications not flowing Miscommunications, errors or delays parliamentary comments are 6.5 through to project sponsor to project 23Ccommunicated DIER 2 3 C C Ongoing
22 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
TASMAN HIGHWAY AND GLADSTONE MAIN ROAD UPGRADES - RISK ASSESSMENT Development and Delivery Phase - 29/5/12
Residual Risk
Contingent
or
Completed Due
level level (I/C)
Responsible Action Likelihood Consequence Risk Risk Inherent Action Risk Number Element Risk Potential Consequence Risk treatment initiative party Likelihood Consequence
5 Resources
Tender documents to specify Increase in materials cost and that Contractor undertake early 5.1 Pavement material sourcing issues therefore to budget 24Cengagment with local quarries DIER 1 4 C C 27-Aug-12
7Risk Additional or evolving risks not identified Review risk register on monthly 7.1 Risk register not updated on regular basis and managed 23Cbasis SKM, DIER 1 3 D C Ongoing Risks not managed leading to issues Review risk register on monthly 7.2 Risks not identified with design and/or construction 23Cbasis SKM, DIER 1 3 D C Ongoing Review P50 / P90 cost estimate with SKM, DIER PM and DIER CA to ensure appropriate 7.3 Risks not accounted for in project cost estimate Budget is exceeded 24Ccontingencies in place SKM, DIER 1 4 C C 18-Jun-12 Action not taken where required to Review risk register on monthly 7.4 Ownership of risk management minimise risks 33Cbasis SKM, DIER 1 2 D C Ongoing
23 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
Appendix B – Governance
Governance Structure The project will be run with an alliance philosophy under a Governance Structure, clearly defining lines of reporting and accountability. The structure is shown in the following chart, and defined further on the following page.
• Blue boxes indicate key levels within the structure for accountability and reporting. • Green arrows define the lines of reporting, accountability and direction within the structure. • Purple boxes indicate where key inputs are derived from resources or groups external to the lines of reporting. Project Governance Structure
DIT DIER
CORPORATE
PROJECT EXECUTIVE GROUP COMMUNICATIONS
PROJECT MANAGEMENT TEAM
TECHNICAL PROJECT DELIVERY TEAM REVIEW
Denotes line of reporting and accountability
Denotes key input
Denotes key liaison
Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick 24 Submission to Parliamentary Standing Committee on Public Works
Governance for this project fits in with the overall NEFR governance structure set out in the May 2010 PPR (Scoping) – North East Freight Roads and reiterated in the May 2011 Amendment.
PROJECT EXECUTIVE GROUP The Project Executive Group provides the link between Government Policy and the Project Management and Project Delivery teams.
The role of the Project Executive Group is to oversee the delivery of the project, ensuring that: • Outcomes meet strategic intent and are consistent with long‐term planning for infrastructure in Tasmania. • Public funds are being expended in an appropriate manner; • Progress is being made in the delivery of the project in accordance with the Project Plan; • Public consultation messages and communication are consistent with the broader intent of the Agency and State Government; • The Agency Executive, Minister and Government are kept informed of progress on, and issues arising from, the project; • Strategic risks have been recognized and appropriate mitigation strategies implemented and • Keep DITRDLG informed on progress, critical issues, timeframes and future opportunities.
The Project Executive Group shall specifically: • Approve the project objectives and outputs of the proposed planning activities; • Provide direction on strategic issues that arise during the course of the project; • Liaise with Corporate Affairs on critical stakeholder issues and critical communication; and • Provide strategic advice to the Minister, Secretary and Deputy Secretary.
The Project Executive group has the sole authority to amend the project objectives, amend the project scope, extend project timeframes or increase project budget.
The Project Executive Group shall comprise: • General Manager Roads & Traffic Division, DIER (Chair) • General Manager Infrastructure Strategy Division, DIER • Director Traffic and Infrastructure Branch, DIER • Manager Corporate Affairs
The Project Executive group shall meet with the Project Management Team at regular intervals to review progress of the project. Project Governance meetings will be held on an as needs basis as determined by the Chair.
In the event that a Project Executive Group member cannot attend a scheduled meeting, they may nominate a proxy who shall assume their full rights and responsibilities. 25 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works
The Project Executive Group is active for the North East Freight Roads Strategy, has endorsed the PPR and has set direction for project prioritisation for delivery within the allocated funding.
PROJECT MANAGEMENT TEAM The role of the Project Management Team is to manage the delivery of the project in accordance with the agreed objectives and directions from the Project Executive Group. The Project Management Team is specifically responsible for the management of the project risks, budget, programme and outputs. The Project Management Team has the authority to reallocate funds within the approved budget and reorganise activity timeframes within the approved programme, without prior approval of the Project Executive group. Any changes of this nature are to be reported to the Project Executive Group in normal monthly reporting. The Project Management Team shall organise Project Governance meetings as requested by the Chair. The Project Management Team shall comprise:
1. Project Manager, DIER 2. Director
The DIER representative on the Project Management Team shall be responsible for officer level liaison with the DITRDLG.
PROJECT DELIVERY TEAM The role of the Project Delivery Team is to deliver the technical and statutory requirements of the Project Brief through the application of relevant Legislation, Technical & Design Guidelines, Australian Standards, standard specifications and sound engineering and planning judgement.
The Project Delivery Team reports directly to, and takes direction from, the Project Management Team. While the Project Delivery Team will seek technical input and guidance from other areas of the Agency it has no reporting line or accountability other than to the Project Management Team.
The Project Delivery Team shall comprise: 1. Project Manager, Planning & Design 2. Technical Manager, relevant consultant 3. Technical Resources
26 Tasman Highway and Gladstone Main Road Upgrades – From Derby through to Herrick Submission to Parliamentary Standing Committee on Public Works